Less than half of 2026 has passed, but one thing can be concluded in advance: without the support of overseas markets, the production and sales data of China's automotive industry this year will look very bad.
First, let's look at the domestic market.
Jan-April, domestic passenger car cumulative retail sales reached 5.604 million, down 18.5% year-on-year. Among them, fuel vehicle sales fell by approximately 19.8%, while new energy vehicles also declined by 17.2%. April retail sales alone were 1.384 million, down 21.5% year-on-year and down 16.0% month-on-month.
This is not a problem of a specific segment, but rather the entire market is contracting.
Now let's look at exports.
For the same period, China's cumulative auto exports reached 3.25 million, a year-on-year increase of 50.6%. New energy vehicle exports were nearly 1.5 million, accounting for 48%, up 69% year-on-year.
In April alone, passenger car exports accounted for 36% of manufacturer sales, compared to only 19% at the same time last year. It was precisely the strong performance of exports that stabilized the slowdown in the domestic market.
In Jan-April this year, China's auto production and sales overall declined year-on-year by 4.8% to 5.5%. Although this negative growth is rare in recent years, it is still a single digit. Without exports, this number would look much worse.
Auto exports are no longer an optional peripheral business; they are profoundly changing the business structure of Chinese automakers.
So the question arises: Where exactly did these cars go?
Brazil: A Qualitative ChangeLet's look at two rankings first.
In the top ten exports of all passenger car categories, Brazil ranks first, and Russia ranks second.
In the top ten new energy vehicle exports, Brazil is still first. 280,000 and 210,000 vehicles—these two numbers added to Brazil's account, with year-on-year growth rates reaching 226.1% and 220.9% respectively.
What does this mean?
BYD alone exported nearly 90,000 units to Brazil in the first quarter of this year, including battery electric and plug-in hybrid models. Great Wall Motor has already built two factories in Brazil, with the second one having an annual capacity as high as 200,000 units.
But the signal truly worth remembering is not these numbers.
In April this year, BYD sold 14,911 units in Brazil, surpassing Volkswagen to take the first place on the total monthly retail sales list for the first time.
The Brazilian market has long been dominated by European, American, and Japanese brands. This is the first time Chinese new energy vehicle brands have surpassed traditional fuel giants in monthly sales.
The psychological impact of this event in Brazil is no less than when Apple first surpassed Nokia in China back then.
And this result was not unexpected.
First, Chinese automakers entered densely. GAC, Chery, Geely, Leapmotor, and Changan have already laid out their plans in Brazil, with a solid grassroots foundation.
Second, local production is accelerating. BYD's factory in Camaçari has already exceeded 4,100 employees and will soon add another 1,600 to start the third shift.
Third, although the policy environment in Brazil has tariffs, it does not engage in backdoor deals. The product competitiveness of Chinese cars is strong enough; no extra privileges are needed, only fair rules.
From 2026 onwards, Brazil will no longer be an overseas market in the conventional sense; it has become the second home market for Chinese automakers.
Local market refers to the qualitative change from "export destination" to "production and sales integrated market", representing a fundamental shift in the logic of China's automotive going global.
Now let's look at Europe.
In the all-category rankings, the UK ranks third with 151,000, up 99.3%; Belgium ranks fourth with 130,000, up 40.3%; Italy ranks seventh with 92,000, up 121.2%.
If looking at the new energy rankings alone, Italy grew by 460.7%, Germany by 295%. From the UK to Spain, growth rates were all above 80%.
The data for the European market is very impressive. Behind this lies a key factor: Chinese-style hybrid.
Data from the China Passenger Car Association shows that in the export structure in April, the share of plug-in hybrids has reached 18%, up 4 percentage points year-on-year.
This is a move of avoiding the strong and striking the weak adopted by Chinese automakers facing tariff barriers from Europe and the US.
The EU began implementing anti-subsidy tariffs on April 15, raising the comprehensive tax rates for BYD, Geely, and SAIC to 27% to 45.3%. This greatly weakened the price advantage of pure electric models.
However, hybrid models equipped with engines are not subject to the same degree of tariff constraints. Chinese automakers quickly adjusted their strategy to penetrate the European market with hybrid models.
No need for direct confrontation, but to find loopholes within the rules.
This ability to adapt flexibly is built on the strong R&D and manufacturing capabilities of Chinese automakers. This is also the biggest hidden advantage of China's automotive going global.
Amidst the growth, two markets declined: the UAE down 13.2%, and Mexico down 46.6%.
The UAE's new energy data is still surging, balancing the trend, but Mexico's decline is more pronounced.
Analysis reveals two reasons.
Subjectively, the substitution rate of local production in Mexico is increasing.
More and more Chinese automakers are building factories in Mexico, so the volume of complete vehicle exports naturally declines. This is essentially not a bad thing, but rather a necessary stage for the upgrade of China's automotive going global.
Objectively, the uncertainty of US policies has increased investment risks in the Mexican market. The closer to the US, the harder the business, and this does exist.
In the future, when looking at China's auto export data, one cannot simply assume something is wrong when seeing a decline in a certain market. First, check if the power of local production has become stronger, rather than looking at new things with old eyes.
In the rankings, only Malaysia from Southeast Asia ranks tenth.
This does not mean the Southeast Asia market is declining. On the contrary, the current performance of Southeast Asia is a typical case of "surface slowdown, actual transformation".
In 2025, the market share of Chinese brands in Thailand, Indonesia, and Malaysia reached 22%, 22.8%, and 26% respectively, with Japanese brand shares falling completely.
In January this year, the share of Chinese brands in Thailand's pure electric market approached 50%.
The export volume did not make the top ten not because Chinese cars could not sell there, but because a large number of products have achieved local production and are no longer counted in the data in the form of complete vehicle exports.
This is a signal sent in advance: in the future, the "cooling" of many markets may actually be an "upgrade".
Through these data, we can see deeper industrial changes.
On one hand, exports drive wholesale.
The China Passenger Car Association clearly pointed this out. Since the beginning of this year, exports have continued to strengthen, forming a clear trend of "exports driving wholesale". Top automakers rely on exports to digest capacity and reduce inventory backlog.
On the other hand, 2026 is the watershed from complete vehicle exports to supply chain going global. Whether active or passive, Chinese automakers are shifting from simply selling products to building factories, supply chains, and after-sales service systems in target countries.
Finally, and most crucially, the logic of making money has finally been established, and the model of making money has finally been proven.
In the past, when discussing going global, everyone was used to calculating sales volume and market share.
But from Jan-April 2026, the automotive industry profit margin was only 3.4%, at a historical low. If we simply copy the domestic price wars overseas, blindly pursuing sales growth without contributing to profits, that is fake globalization.
True globalization is like Toyota, building sustainable profitability in different markets.
BYD and Great Wall's localization in Brazil, Chery's deep cultivation in Europe, Geely's precise efforts in emerging markets, are all essentially doing the same thing: shifting from scale-oriented to profit-oriented.
The destinations of Chinese automotive exports in the first four months of 2026 tell us that Brazil, Russia, and the EU are all very important, but whoever can let us complete the loop of industry chain, service chain, and marketing chain faster beyond just selling cars is the true favorable land.
Like Southeast Asia.
